From Funeral To Foreclosure? April 7, 2008
Posted by CalebConner in : Insurance, Real Estate , add a comment
When you think of the word home, not house, but home, what do you feel? Comfort, safety, sanctuary and protection may come to mind. There are many emotional ties that people hold to their homes, and rightly so. It’s probably the largest purchase you will ever make, so it’s important that it be protected. Most people are aware they need homeowners insurance when they buy a house, and they may even call around to see if they can find the best deal.
For the most part, insurance is not complicated, but serves as a financial tool designed to transfer the risk of personal, bankrupt able catastrophes over to larger companies who have pooled insurer’s assets in order to pay claims. It’s a smart decision to have home insurance (just ask your lender). Here is a fun fact that you might not be aware of: statistically only 1 out of 100 homes will result in a total loss due to a fire. That is tragic, but not as tragic as the number of homes lost due to the death of a spouse.
Every year, 15 out of 100 homes are lost due to the death of a spouse. Gasp!!! This occurs, primarily, because the remaining spouse will not be able to pay the mortgage without the other spouse’s income. Life insurance is a simple solution for this problem and is one of the most overlooked areas of financial planning. Twenty or thirty year level term insurance is a critical component in any individual’s well-prepared financial plan and can be derived using a simple formula. Level term insurance is designed to replace lost income due to the death of a spouse, which for most people is around 10 times their income.
For example, suppose someone earns $40,000 per year and their spouse earns $35,000 a year. Their spouse will need $350,000 in life insurance and they will need $400,000 in life insurance. Not having level term insurance in place is frankly irresponsible and can leave your family in dire straits. It is important to talk with a trusted insurance agent and financial advisor to make sure that you have the coverage you and your family needs.
Death is inevitable, but steps can be taken now so that the loss of a loved one is the only loss suffered. Consult with your insurance and financial advisor today!
Caleb Conner
Farmers Insurance
325-227-9841
http://www.farmersagent.com/cconner1/index.htm
Posted by CalebConner in : Insurance, Real Estate